[Adobe Stock]
Over the past three months, the pharma sector has seen a string of investments in manufacturing facilities, especially in Europe. While the European economy lost momentum in 2023 owing to a high cost of living, weak external demand, and monetary tightening, the prospects for growth remain stronger with the EU GDP growth forecast to improve to 1.3% in 2024, according to the European Commission. As economic prospects improve in 2024, major pharma companies are doubling down on investments in European manufacturing infrastructure and jobs to meet strong global demand. While the sector regains momentum, the European Federation of Pharmaceutical Industries and Associations (EFPIA) has expressed concerns about a proposed overhaul of pharma rules from the European Commission, which it worries could harm future investments in the region. For the time being, major pharma companies including Novo Nordisk, Eli Lilly, and Boehringer Ingelheim have unveiled substantial investments in new or expanded European production plants over the past few months.
Novo Nordisk makes multi-billion euro commitment to expand production capacity in Denmark
On November 9, 2023, Danish pharma giant Novo Nordisk revealed in late 2023 that it was making a significant investment in the expansion of its manufacturing facilities in Denmark. The company plans to invest over 42 billion Danish kroner (approximately €2.1 billion) in the construction of a new 65,000 m² manufacturing facility in Kalundborg, Denmark. This investment is part of a series of production investments in Denmark that the company has made over the past two years, totaling 40 billion Danish kroner. The expansion, which the company expects to wrap up between 2025 and 2029, aims to bolster the company’s production capacity. Sustainability will be a priority and Novo Nordisk said it would focus on reducing water and energy consumption. The new facility will accommodate both current and future product lines, including the production of active pharmaceutical ingredients (APIs) for Novo Nordisk’s products, such as the blockbuster Wegovy. Novo Nordisk expects the project to lead to the creation of an additional 800 jobs, adding to the approximately 1,100 employees that it had hired in production-related roles due to previous investments.
Eli Lilly to construct major new manufacturing site in Germany, create 1,000 jobs
November 17, 2023: American pharmaceutical company Eli Lilly said it would build a new $2.5 billion manufacturing facility in Alzey, Germany. This facility will expand Lilly’s global network for producing injectable pharmaceutical products and medical devices, including those in the diabetes and obesity portfolio. Construction on the Alzey site is slated to begin in 2024, with operations targeted for 2027. The facility will create up to 1,000 skilled jobs for roles in engineering, operations, and science. This investment marks Lilly’s first major production facility in Germany and increases the company’s European manufacturing footprint to six sites. The project is contingent upon final government approvals and permitting at the local level. In addition to the facility, Lilly said it aims to invest up to $100 million in Germany’s emerging biotechnology and life sciences companies
Novo Nordisk doubles down with $2.3 billion investment to extend facility in France
November 24, 2023: In addition to its plans to invest in upgrading its manufacturing footprint in Denmark, Novo Nordisk said it would invest 16 billion DKK (approximately $2.3 billion) to expand its manufacturing site located in Chartres, France. The multi-phase expansion project will more than double the physical footprint of the facility. The new production lines will manufacture both existing and future Novo Nordisk products to bolster capacity. It expects construction to be completed progressively from 2026 to 2028. Once finished, the facility will create over 500 additional jobs in the Chartres region. The company operates six production plants in Europe to meet rising international demand for its innovative medicines and devices.
Boehringer Ingelheim upgrades Greek plant to ramp up capacity across therapeutic areas
On January 11, 2024, the German pharmaceutical company Boehringer Ingelheim announced plans to expand and upgrade its manufacturing plant in Koropi, Greece, with an investment of €120 million. This investment will increase production capacity for both new and existing medications across therapeutic areas including cardiometabolic disease, mental health, and pulmonary conditions. The expansion will specifically boost capabilities for Jardiance, an oral treatment for type 2 diabetes and common comorbidities, with an emphasis on manufacturing for the U.S. market. First established in 1975, the Koropi facility is Boehringer Ingelheim’s only industrial-scale site in Greece. The company has grown its Greek presence considerably since 1966 through strategic investments in operations and talent acquisition.